International Construction Law Review
INTRODUCTION
HUMPHREY LLOYD
DAVID WIGHTMAN
In May 2005 the World Bank in conjunction with FIDIC published a version of the 1999 edition of FIDIC’s Conditions of Contract for Construction (for works designed by the employer) (the Red Book) for use by Multilateral Development Banks. This version, to be known as the MDB Harmonised Version, may be downloaded free of charge from the websites of the World Bank and of FIDIC. A number of banks have participated in its production and will use it. It is of course useful to know that the World Bank endorses the 1999 edition of the Red Book and to have a version which is accepted by other banks. Some of the changes have worried contractors. Our first article (at page 4) explains those concerns. We are most grateful to Richard Appuhn and Eric Eggink for writing it. Both are members of the working group on contract conditions of European International Contractors. (The text has been reviewed by other members of the group.) The article highlights the changes to the definition of “unforeseeable” in clause 1.1.6.8 and its application in clause 4.12; the text of clause 1.13; the provisions for vetting the employer’s financial arrangements in clause 2.4; changes to clause 3.1 removing contractor’s rights on proposed changes to the engineer and his authority; changes to clause 4.2 (performance security); and changes to the thresholds on variations in quantity in clause 12.3. Comments are also made about other alterations.
Since other employers (even in the private sector) may take the view that what is good for the World Bank is good for them, these changes need to be debated. The expansion of the definition of ”unforeseeable” certainly calls for rational justification and explanation of its practical application. It now means “not reasonably foreseeable and against which adequate preventive precautions could not reasonably be taken by an experienced contractor by the date for submission of the Tender”. It can hardly be justified by the fact that, in a different context, clause 17.3(h) refers to “any operation of the forces of nature which is Unforeseeable or against which an experienced contractor could not reasonably have been expected to have taken adequate preventative precautions”. That provision merely restates the contractor’s ordinary responsibilities (spelled out elsewhere in the conditions). Quite what reasonable precautions could be taken by an experienced contractor prior to submitting its tender is mystifying, especially since they only apply to what was unforeseeable. It is also a pity that the opportunity was not taken to look again at clause 1.13.
Our next contribution is about interesting developments in France. Pierre Heitzmann of the Paris office of Jones Day writes on “The Contrat de Partenariat
: A New Form of French Public Private Partnership Allowing the Use of Arbitration to Adjudicate Disputes” (at page 20). Experience in the United Kingdom and elsewhere shows that, in the form of a PFI, construction contracts within a public private partnership are often not of good value. Nevertheless the concept is being followed although no doubt taking account of its limitations. Mr Heitzmann’s article provides an excellent introduction to a new French form of PPP and sets out its main features and characteristics. Some are so stringent that it has yet to be used. However, the article also explains that, as a result of consideration by the courts and others, it is now possible to use arbitration for the resolution of disputes under such PPPs. Since the nineteenth century French administrative law had previously
[2006
The International Construction Law Review
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